If this is your first visit, be sure to
check out the FAQ by clicking the
link above. You may have to register
before you can post: click the register link above to proceed. To start viewing messages,
select the forum that you want to visit from the selection below.

R.i.p.

Well, another one bites the dust as Georgie's assinine plan to privatize Social Security slowly rides off into the sunset. Social Security can be fixed. Privatizing it was not the answer.

Bush's plan dies quietly, leaving lessons for next time

Just one year after Bill Clinton introduced his health care overhaul in 1993, the plan collapsed. It took only eight months for the same to happen to President Bush's proposal to create private Social Security accounts. (Related:Social Security index)

The two episodes are strikingly similar. Both involved ambitious proposals introduced to the public with speeches to Congress. And both lingered for months after chances for success had evaporated. Indeed, when Bush all but conceded defeat in a news conference last week, noting a "diminished appetite" for his proposal, his remarks were barely noticed.

The greatest similarity between Clinton '93 and Bush '05, however, is in the larger point they illustrate: The nation's toughest long-term social problems can't be solved on a partisan basis.

Like Clinton's health plan, Bush's proposal for Social Security was doomed from the outset. It was conceived with virtually no input from Democrats by a commission handpicked to reach a predetermined outcome  that individual accounts were a necessary part of reforming Social Security. In the Republican political calculus, the accounts could be used to build an enduring majority.

The president boasted he could use the "political capital" from his narrow re-election victory to push the plan through. Democrats were instantly alienated, and support waned as a suspicious public discovered that the private accounts would either hasten the traditional program's insolvency or require massive borrowing to set up.

The failure of Bush's plan no doubt delights Democrats. In the past five years, they've been routed on issues ranging from tax cuts to Medicare. They never unified behind their own plan to bail out Social Security, nor did they have much incentive to do so. Merely killing Bush's protected their interests.

For the American people, though, there is less reason for cheer. All the problems that existed before the president's proposal still exist. However flawed his solution, he deserves credit for taking on the basic problem: Without reforms, Social Security will start running a deficit in 2017 and be unable to meet its obligations by 2041, according to the latest estimates from its trustees.

The only reason the program isn't insolvent already is the massive baby boom generation, which is still working and creating a short-term surplus. That surplus provides politicians an excuse to put off reform and is being used as partial cover for their reckless budgetary practices. It will also turn into a massive deficit when those baby boomers stop contributing to Social Security and start taking out.

The collapse of Bush's plan can best be seen as a learning experience and road map for the next time Social Security reform comes up. Some suggestions for that debate:

Start with a real commission. In 1983, Ronald Reagan showed how to reform Social Security. He started with a genuinely bipartisan commission that had no preset agenda other than making recommendations on how best to shore up the program. That commission, chaired by would-be Federal Reserve chairman Alan Greenspan, made proposals, later adopted by Congress, that extended the program's life for decades. It serves as the best example for how to enact painful, but necessary, changes to a program in a politically charged environment.

Make solvency the central focus. As we have noted in previous editorials, private accounts, though not without their appeal, would do nothing to fix Social Security's problems and could make them worse, depending on how they are structured. The next reform proposal should center on ways of making Social Security solvent. That will require some mix of cuts in benefits (such as raising the retirement age for able-bodied workers) and increases in taxes (such as raising the $90,000 cap on annual income subject to Social Security taxes). Whether to create private accounts, either as an add-on or a partial replacement for traditional benefits, is a secondary matter.

Lay the groundwork honestly. The next plan should make clear that shared sacrifice is necessary. To partially address the solvency issue, Bush floated a proposal to curb benefits to middle- and upper-income retirees. That was the kind of medicine Social Security needs. But for Republicans who had been led to believe Social Security reform would be a free lunch and a winning political issue, it came as an unwanted surprise.

Inevitably, Democrats and Republicans will blame each other as next year's congressional elections approach. Ultimately, however, a Social Security fix will require lawmakers of both parties to display a wisdom and concern for the common good that have been sorely lacking of late.

The same qualities will be needed in even larger quantities to address the more urgent and complex issue left unresolved a decade ago  an exorbitantly expensive and yet inefficient health care system.

Both parties have now learned the important lesson that they can't act alone. The solvency of the federal government and the health of the nation's retirement system will depend on whether they can take the next step and find ways to act together.

Re: R.i.p.

"The president boasted he could use the "political capital" from his narrow re-election victory to push the plan through. Democrats were instantly alienated, and support waned as a suspicious public discovered that the private accounts would either hasten the traditional program's insolvency or require massive borrowing to set up."

Clearly you weren't dooped into believing it was a bad plan. :confused:

Where is your sense of independence? Where do you hold your personal pride and worth? Why do you tear down every opportinity placed before you to better your personal wealth? The Social Security reform that was proposed was either 'too against the grain of socialism' for you; or the mathematics required to understand that you would have a better financial situation upon retirement was just beyond your education. Not very hard though.
2+.00000004 = 2.00000004 (social security now) vs.
2+.4 = 2.4 (ss reformed). Now, true, both quotients have a 2 and a 4 in them, however 2.4 > 2.00000004. Under the proposed program bacardi, you could EVEN have opted to leave your plan alone and nothing would have changed for you. The plan WILL be revisited later though and it WILL pass. :cool:

Re: R.i.p.

Originally Posted by Raider

Clearly you weren't dooped into believing it was a bad plan. :confused:

Where is your sense of independence? Where do you hold your personal pride and worth? Why do you tear down every opportinity placed before you to better your personal wealth? The Social Security reform that was proposed was either 'too against the grain of socialism' for you; or the mathematics required to understand that you would have a better financial situation upon retirement was just beyond your education. Not very hard though.
2+.00000004 = 2.00000004 (social security now) vs.
2+.4 = 2.4 (ss reformed). Now, true, both quotients have a 2 and a 4 in them, however 2.4 > 2.00000004. Under the proposed program bacardi, you could EVEN have opted to leave your plan alone and nothing would have changed for you. The plan WILL be revisited later though and it WILL pass. :cool:

That's what you neo-cons just don't get pirate man. Social security is not about independence, not about personal pride, not about personal worth or wealth. Social Security is about forsaking personal gain for the greater good of society as a whole. This plan will pass when hell freezes over and you can bank on that one.

Re: R.i.p.

Originally Posted by bairdi

That's what you neo-cons just don't get pirate man. Social security is not about independence, not about personal pride, not about personal worth or wealth. Social Security is about forsaking personal gain for the greater good of society as a whole. This plan will pass when hell freezes over and you can bank on that one.

Hey man, how many 70 year old programs do we utilize in the FED? Lots, but the've all been tweaked, updated, repaired and bettered along the way....all but ONE - right... social security! It will be fixed my socialist friend, I just hope it's done before my cutoff date to make it a better deal. Why do elitest snobs think that big government has all the solutions. I'll tell you why, because deep down they're scared. They know that their personality will cause them to fail the self-reliance test. pitiful.... :(

Re: R.i.p.

Originally Posted by Raider

Hey man, how many 70 year old programs do we utilize in the FED? Lots, but the've all been tweaked, updated, repaired and bettered along the way....all but ONE - right... social security! It will be fixed my socialist friend, I just hope it's done before my cutoff date to make it a better deal. Why do elitest snobs think that big government has all the solutions. I'll tell you why, because deep down they're scared. They know that their personality will cause them to fail the self-reliance test. pitiful.... :(

Bush did not address the issue of how the system would continue to provide benefits for current and near-future retirees if some of the incoming Social Security tax receipts were to be diverted into private accounts. A few days later, however, Vice President Dick Cheney stated that the plan would require borrowing $758 billion over the period 2005-2014; that estimate has been criticized as being unrealistically low.

On April 28, 2005, Bush held a televised press conference at which he provided additional detail about the proposal he favored. For the first time, he endorsed reducing the benefits that some retirees would receive.

Opponents argued that the plan would result in high transition costs, with the midline estimates to be in the vicinity of over $2 trillion over 10 years. For workers, privatization would mean smaller social security checks, with the likelihood based on historical returns of increased compensation from returns on investments. There is debate over the advisability of subjecting workers' retirement money to market risks.

Re: R.i.p.

Originally Posted by ianmatthews

Bush did not address the issue of how the system would continue to provide benefits for current and near-future retirees if some of the incoming Social Security tax receipts were to be diverted into private accounts.

You have heard of the surplus....right? The only obstacle was bushie slappin' the filthy mitts of congress away.

Originally Posted by ianmatthews

A few days later, however, Vice President Dick Cheney stated that the plan would require borrowing $758 billion over the period 2005-2014; that estimate has been criticized as being unrealistically low.

To fix it, you gotta fund it. Sh!t ain't going to fix itself now is it?

Originally Posted by ianmatthews

On April 28, 2005, Bush held a televised press conference at which he provided additional detail about the proposal he favored. For the first time, he endorsed reducing the benefits that some retirees would receive.

Endorsed??? He just stated that YES, the check recieved from ss would be less. But when you add it to the money that you put into the personal fund part, the sum is much larger.

Originally Posted by ianmatthews

Opponents argued that the plan would result in high transition costs, with the midline estimates to be in the vicinity of over $2 trillion over 10 years. For workers, privatization would mean smaller social security checks, with the likelihood based on historical returns of increased compensation from returns on investments. There is debate over the advisability of subjecting workers' retirement money to market risks.

I saw this somewhere before... where was it? Oh yeah, it was the John Frickin' Kerry's website. These opponets you speak of are partisan hacks that are paid to lie about the numbers. Too bad that suckers actually bought it. Everyone would have been better off in their longrun. My magic number was 42. Under 42 the plan would have worked out better for me even calculating a modest 4.5% return. Over 42, it could have broken either way...Too bad I'll have to be a little closer to that magic number before it gets fixed.

Re: R.i.p.

Originally Posted by Raider

You have heard of the surplus....right? The only obstacle was bushie slappin' the filthy mitts of congress away.

Social security has had a surplus in past years because the number of people paying into the system was far greater than the number of people receiving benefits. The entire system was set up as a pay in- pay out system. Social Security didn't start, then wait 40-50 years for the people who began paying into it to retire. It started and the people paying into paid for the people who were retired. No problem- as long as more people were paying in then receiving benefits. Then as the age of the US population swifted and became older the ratio of people paying into it as to people taking out of it was reduced. So the idea that Social security would be alright if we simply didn't borrow and spend the surplus is not entirely correct.

To fix it, you gotta fund it. Sh!t ain't going to fix itself now is it?

Does any of it address how his plan to swift funds into private accounts somehow fixes the system's funding shortfalls? I know I saw Scott McClellan say, the day after Bush gave his SOTUA, that the accounts don't do anything to fix that problem. So, again Bush's plan doesn't fix anything. But it does remove a whole bunch of money from the system. Money that will have to be borrowed, increasing the deficit even more. I just can't believe that increasing the deficit is a GOP idea. I just don't get it.

I saw this somewhere before... where was it? Oh yeah, it was the John Frickin' Kerry's website.

First of all, attack the source he used, not him. Kerry has little or nothing to do with it. You're using misdirection.

All I said were "opponents claim" I didn't endorse the number. Also, I don't see you presenting an alternative transitional cost, say from CATO.

Re: R.i.p.

There are only two things that could endanger Social Security's ability to pay benefits before the trust fund runs out. One would be a fiscal crisis that led the U.S. to default on all its debts. The other would be legislation specifically repudiating the general fund's debts to retirees.

That is, we can't have a Social Security crisis without a general fiscal crisis - unless Congress declares that debts to foreign bondholders must be honored, but that promises to older Americans, who have spent most of their working lives paying extra payroll taxes to build up the trust fund, don't count.

Politically, that seems far-fetched. A general fiscal crisis, on the other hand, is a real possibility - but not because of Social Security. In fact, the Bush administration's scaremongering over Social Security is in large part an effort to distract the public from the real fiscal danger.

There are two serious threats to the federal government's solvency over the next couple of decades. One is the fact that the general fund has already plunged deeply into deficit, largely because of President Bush's unprecedented insistence on cutting taxes in the face of a war. The other is the rising cost of Medicare and Medicaid.

As a budget concern, Social Security isn't remotely in the same league. The long-term cost of the Bush tax cuts is five times the budget office's estimate of Social Security's deficit over the next 75 years. The botched prescription drug bill passed in 2003 does more, all by itself, to increase the long-run budget deficit than the projected rise in Social Security expenses.

That doesn't mean nothing should be done to improve Social Security's finances. But privatization is a fake solution to a fake crisis.

Re: R.i.p.

Sourced directly from http://www.ssa.gov/qa.htmQuestions and answers section. It looks like stuff hittin the fan in 2041. Steady decline year after year after then. So, I guess that your camp wants to see the coming hurricane and hunker on down. My camp says let's fix the on-coming problem head on and be prepared.

Q I'm 35 years old. If nothing is done to improve Social Security, what can I expect to receive in retirement benefits from the program?

A Unless changes are made, at age 71 in 2041 your scheduled benefits could be reduced by 26 percent and could continue to be reduced every year thereafter from presently scheduled levels. See the 2005 Trustees Report.

Q I'm 26 years old. If nothing is done to change Social Security, what can I expect to receive in retirement benefits from the program?

A Unless changes are made, when you reach age 62 in 2041, benefits for all retirees could be cut by 26 percent and could continue to be reduced every year thereafter. If you lived to be 100 years old in 2079 (which will be more common by then), your scheduled benefits could be reduced by 32 percent from today's scheduled levels. See the 2005 Trustees Report.

Q Should I count on Social Security for all my retirement income?

A No. Social Security was never meant to be the sole source of income in retirement. It is often said that a comfortable retirement is based on a "three-legged stool" of Social Security, pensions and savings. American workers should be saving for their retirement on a personal basis and through employer-sponsored or other retirement plan.

Re: R.i.p.

Originally Posted by Raider

Sourced directly from http://www.ssa.gov/qa.htm
[COLOR=Blue]Questions and answers section. It looks like stuff hittin the fan in 2041. Steady decline year after year after then. So, I guess that your camp wants to see the coming hurricane and hunker on down. My camp says let's fix the on-coming problem head on and be prepared.

First of all, if by camps you mean the two parties... forget it. I'm with neither.

Have you any idea how unpredictable the market can be? Bush knows Americans worry about this, so he gives us a 'choice'. But look behind Bush's words. Look at what his plan will mean for SS. By allowing the transfer of a third of your SS tax to 'private accounts', he will, as Pacridge has mentioned before, not be doing anything to fix SS. By doing this, SS will go bankrupt, or we will see an increase in taxes or a decrease in benefits. But if Bush's plan passes, be ready to say goodbye to SS as we know it now forever. Once we privatise it, it will be very difficult to 'un'privatise it. That is why the conservative plan isn't smart economically speaking, nor is it just or right. The plan forces free-market ideas of privatisation down our throats. The people who choose to not invest money will be punished, as they are likely to see a combination of increased taxes and decreased benefits. This is all to pay for the huge cost of this transition. There is a way to fix the SS crisis without raising taxes or lowering benefits or privatisation. Raise the $90,000 ceiling. It's that simple.

Look, check any neutral economic analysis of the privatization plan and you will see they side against this plan. It's a moot point though, this plan is never gonna happen. People saw through it pretty quickly. You guys can convince yourself of anything!

Re: R.i.p.

Originally Posted by ianmatthews

First of all, if by camps you mean the two parties... forget it. I'm with neither.

Have you any idea how unpredictable the market can be? Bush knows Americans worry about this, so he gives us a 'choice'. But look behind Bush's words. Look at what his plan will mean for SS. By allowing the transfer of a third of your SS tax to 'private accounts', he will, as Pacridge has mentioned before, not be doing anything to fix SS. By doing this, SS will go bankrupt, or we will see an increase in taxes or a decrease in benefits. ( This is inevitable anyway under the current plan. The Bush plan just preempted the doomed future of the existing system )But if Bush's plan passes, be ready to say goodbye to SS as we know it now forever. Once we privatise it, it will be very difficult to 'un'privatise it. That is why the conservative plan isn't smart economically speaking, nor is it just or right. The plan forces free-market ideas of privatisation down our throats. The people who choose to not invest money will be punished,( originally proposed, people had the choice to opt out and keep their benefits just as they would have been if the system wasn't tweaked at all ) as they are likely to see a combination of increased taxes and decreased benefits.( you are aware that it's not a question of 'if' but of 'when'..right? ) This is all to pay for the huge cost of this transition. There is a way to fix the SS crisis without raising taxes or lowering benefits or privatisation. Raise the $90,000 ceiling.( You understand that if you raise this 'ceiling' then that means that ss payouts to the top tier of recipients will increase proportionately ) It's that simple.

Look, check any neutral economic analysis of the privatization plan and you will see they side against this plan. It's a moot point though, this plan is never gonna happen. People saw through it pretty quickly. You guys can convince yourself of anything! ( economists will delve further into this and perhaps a 'better' plan will come along, but it will be simular, and that's a fact jack! )
: )

Time will tell and we will see. In the mean time, I will just sacrifice a little more pre-tax and do it on my own. Self-reliance.....right?

Re: R.i.p.

Originally Posted by Raider

Hey man, how many 70 year old programs do we utilize in the FED? Lots, but the've all been tweaked, updated, repaired and bettered along the way....all but ONE - right... social security! It will be fixed my socialist friend, I just hope it's done before my cutoff date to make it a better deal. Why do elitest snobs think that big government has all the solutions. I'll tell you why, because deep down they're scared. They know that their personality will cause them to fail the self-reliance test. pitiful.... :(

self reliance!?you must be a greek!!i hear they thru babys off cliffs if they saw weakness in their character!!exactly where are they today!?top of the food chain!?.......NOT!!go ahead!!be a NATZI BLUE EYED ARYAN!!see where ya end up!!........roadkill!!why dont cha advertise locally for liberals(gays!?) ta beat on!!CHICKEN!?volunteer for over in iraq!?CHICKEN!?your political heros ever serve active duty!?CHICKEN!?ad infinitem!!ZZZZZZZZZZZZZZZZZZZZ!!!
:p :p :rolleyes: